Alex Constantine - October 25, 2014
"... Many noted that his personal spending habits were as conservative as his politics, which included a leadership role in the John Birch Society. ..."
Nelson Bunker Hunt, the wildcatter who surpassed the legacy of his father, H.L. Hunt, died Tuesday of congestive heart failure at a Dallas assisted living center. He was 88.
Hunt outdid his father in creating and losing fortunes through titanic plays in oil, silver, soybeans, sugar beets, cattle and thoroughbred horses, his passion.
“He was very smart, and he was willing to take a risk, because he could see the prospects of what it might make,” said his sister Caroline Rose Hunt. “I was fortunate enough to be invited by him to the Kentucky Derby and other big races. That was his love, horses.”
A gambler and unabashed capitalist, Hunt lived for the big deal, plowing his oil profits into an array of ventures ranging from ancient Greek coins to the Shakey’s Pizza chain. And there was the Bronco Bowl bowling and entertainment complex in Dallas.
At his financial zenith in the 1970s, Hunt had worldwide real estate holdings that included more than 8,000 acres of Kentucky blue grass horse farms and cattle stations in Australia. In 1979, he purchased 2,500 square miles of Australian grazing land for $4.6 million.
Despite his riches, Hunt lived modestly. He flew coach, wore off-the-rack clothing and drove nondescript cars. Many noted that his personal spending habits were as conservative as his politics, which included a leadership role in the John Birch Society.
Making money, he once said, is “the way you keep score in life, in business.”
His less public profile included his religious life. For many years he was a member of Highland Park Presbyterian Church. In 1991, he was a founding member of Park Cities Presbyterian Church, where he was an elder emeritus. He was a past president of the Texas Bible Society.
Hunt’s financial dramas were often played out in courtrooms, where he faced off against opponents including big oil, the federal government, market regulators and an up-and-coming Libyan dictator, Moammar Gadhafi, who nationalized the Texan’s interest in the Sarir field in 1973.
East Texas beginnings
Born in El Dorado, Ark., Hunt grew up in Tyler in East Texas. He was known by his middle name, derived from his maternal grandfather, Nelson Waldo Bunker.
On Jan. 1, 1938, Hunt moved with the other members of H.L. Hunt’s first family from East Texas into a replica of George Washington’s Mount Vernon estate overlooking White Rock Lake in Dallas.
Hunt exhibited his drive and tenacity early on. When he was 12, he walked alone for 9 miles across London after the buses quit running at midnight.
He briefly attended the University of Texas but left after a geology lecturer proclaimed that the federal government should own all natural resources.
After serving in the Navy during World War II, Hunt joined his father’s oil company. He was 22 when he discovered a $7 million oil field in Scurry County.
His father also put him in charge of the family’s Penrod Drilling Corp. But in the early 1950s, Hunt was either fired or quit his father’s company and struck out on his own. He hired a University of Illinois professor, who pointed the young wildcatter to the Middle East and North Africa.
His early unsuccessful efforts in Pakistan and Libya drained his finances. In 1960, he sold half his interest in a Libyan lease to British Petroleum to raise exploration money.
In November 1961, Hunt and British Petroleum, now BP, struck oil. Hunt’s half interest in the Sarir field, one of the largest in Africa, held about 5.5 billion barrels of crude.
By 1967, the field was pumping $30 million a year into Hunt’s coffers.
Waves of success
Hunt seemed to cash in on bets in investment waves. As the Libyan oil money flowed in, his passion for horses started paying off. Not content to enjoy the sport of kings as a spectator, he bought eight yearling thoroughbreds in Kentucky in 1955.
Over the next 30 years, his interest grew to include owning 300 broodmares and breeding shares in more than a dozen top stallions. He maintained a 40- to 60-horse racing stable. He won the Eclipse Award for outstanding American breeder in 1976, 1985 and 1987.
Like most of his other assets, his horses returned dividends. He owned the first filly in history to win $1.5 million.
Hunt’s successful roll ran into headwinds in 1969, when Gadhafi, an army colonel, led a coup and seized control of Libya. Four years later, Gadhafi nationalized Hunt’s oil operations.
Hunt diversified by investing in land and commodities. He bought thousands of acres of farmland in Tennessee and Mississippi. He owned an estimated $12 million in Greek and Roman coins that appreciated to $18.2 million.
He also purchased Great Western Sugar Co., one of the nation’s largest sugar-beet processing companies.
In the early 1970s, Hunt and his younger brother William Herbert Hunt began buying silver as an inflation hedge at $1.50 an ounce. At the time, private citizens couldn’t hold gold. Over a decade, they parlayed their speculation into a $4.5 billion stake in silver.
In a 2009 interview, Hunt family biographer Harry Hurt III said Hunt bought the silver believing that apocalyptic days were coming that would make money useless.
“They [critics] misunderstood him,” Hurt said. “The guy was a fanatic. He really believed that stuff.”
New reports surfaced in London that the Hunts were trying to corner the market in silver. The stories noted that the brothers “could well be courting disaster.”
In January 1980, they were called to testify before Congress as their silver holdings grew and the price soared. On Jan. 17, 1980, silver traded for $50 an ounce. The brothers’ $1 billion speculation was valued at $4.5 billion. But officials suspended silver trading and increased margin calls. The brothers and their trading partners controlled 250 million ounces of silver. Stunned federal commodity regulators set trading limits that sent prices lower.
On March 25, the trading changes resulted in a $135 million margin call on the brothers’ positions — a lot of money even by Hunt standards. They halted their silver operation and scrambled to cover an estimated $1.7 billion in losses.
On March 27, “Silver Thursday,” the metal’s price dropped 50 percent to close at $10.80 an ounce. Panic spilled across worldwide financial markets. The brothers lost $1 billion and were bailed out by a consortium of 20 national and international banks.
The brothers spent much of the 1980s selling assets in an unsuccessful effort to stave off bankruptcy, which came in 1988. Hunt had $500 million in debts and $100 million in assets. It was the largest personal bankruptcy in American history. The liquidation included 580 horses at Keeneland that brought in $46.9 million.
Back from broke
Hunt recovered from bankruptcy, just as many other wildcatters had done before. His share of a family trust was estimated to be about $200 million.
He returned to thoroughbred ownership, buying 51 juveniles and yearlings.
In 1973, the Hunt brothers faced federal wiretapping charges. The brothers suspected employees of their father’s food company were siphoning millions. They were indicted but acquitted in a Lubbock trial.
Hunt’s later life was handicapped by deteriorating health as he battled cancer and dementia.
The Margaret Hunt Hill Bridge is named for a sister.
Hunt is survived by his wife, Caroline, and his four children, Betsy Curnes, Ellen Flowers, Mary Huddleston and Houston Hunt.
Services will be at 11 a.m. Friday at Park Cities Presbyterian Church. Memorial contributions can be made to the church, 4124 Oak Lawn Ave., Dallas 75219, or The JESUS Film Project, P.O. Box 628222, Orlando, Fla. 32862.
Staff writer Alan Peppard contributed to this report.